© 2020 Arizent. All rights reserved.

Lawmakers try to stop state-sponsored retirement plans: Retirement Scan

Register now

Our daily roundup of retirement news your clients might be thinking about.

Lawmakers try to stop state-sponsored retirement plans
Small businesses would not be allowed to enroll their employees automatically in state-run retirement plans under legislation introduced by Reps. Tim Walberg, R-Mich., and Francis Rooney, R-Fla., according to this article on The Wall Street Journal. The Labor Department issued rules that enable small businesses to sign up their workers automatically to a state-sponsored retirement plan, but this regulation “will discourage small businesses from offering private-sector plans” and push workers “into government-run plans with fewer protections and less control over their hard-earned savings,” say the lawmakers.

3 ways to maximize your Medicare
Clients are advised to enroll in Medicare on time to make the most of the program's benefits, according to this article on Motley Fool. They should also review their medication needs, identify their generic equivalents, and get the Part D plan that covers the most of these generic drugs. Depression is likely when people hit retirement, so clients should look for Medicare coverage that offers free depression screening.

Ask Larry: Was I misinformed about filing and suspending?
A 62-year-old client who is insured for Medicare can have his wife apply for coverage on his record when she reaches the age of 65, according to this article on Forbes. While he can file and suspend his Social Security benefits from age 66 to 70, his wife will not also be allowed to collect a spousal benefit on his record during this period.

The importance of budget planning in retirement
Following a reasonable budget in the golden year is key to securing a comfortable life in retirement, according to this article on Kiplinger. When engaged in budget planning, clients should aim to pay down their debt and account for their future healthcare expenses. They may also want to set aside an amount, invest it and use the returns to travel and pursue leisurely activities.

Roth IRA has many advantages
Unlike a traditional IRA, a Roth IRA does not offer an upfront tax deduction on contributions but provide long-term tax benefits to retirement savers, according to this article on Chicago Tribune. For example, Roth investors are allowed to make tax- and penalty-free withdrawals before the age of 59 1/2 as long as the account is at least five years old. They are also not compelled to start taking required minimum distributions when they reach the age of 70 1/2.

For reprint and licensing requests for this article, click here.